Thompson said three of the most common scenarios people experience in their lifetime when it comes to money is windfalls, emergencies\/crises and debt.<\/p>\n
People in their 20s usually have debt which can be paid off over a relatively short term, like credit card debt, by tightening their belt for a few months.<\/p>
However, people in their 30s are likely to have amassed debts which are not that easily settled, like a home loan or car finance.<\/p>\n
\u201cThis comes with having moved into the next phase of life which can include marriage, a home and children.<\/p>\n
\u201cHome loans stretch over a 25-year repayment period, cars up to seven years and expenses like university fees can be payable for up to five years.<\/p>\n
\u201cMoney is a different ball game now as you juggle loan amounts of hundreds of thousands, perhaps even millions if you consider the cost of property today.<\/p>\n
\u201cSuddenly, there is no quick fix to simply get rid of debt over a few months; you are bound to it for years to come,\u201d he said.<\/p>\n
\u201cDebt is a fact of life and as you get older your financial planning for this has to change.<\/p>\n
\u201dYour debts are fixed expenses which will require a more mature money mentality.<\/p>\n
\u201cMy advice is to implement a tight budget and save at least six months of your home loan or other large debt.<\/p>\n
<\/p>\n
ALSO READ:<\/span><\/p>\n Marketing your business takes centre stage at networking meeting<\/a><\/p>\n Make saving goals achievable and build confidence<\/a><\/p>\n <\/p>\n \u201cAfter six months, put the money into an investment account, like a fixed deposit or tax-free investment, towards your retirement planning.\u201d<\/p>\n While it is necessary to become more financially mature as you age, Thompson said being financially successful and having a stress-free retirement requires strict internal controls.<\/p>\n \u201cThis is why engraining financial prudence in your lifestyle from a young age can be a great help later in life.<\/p>\n \u201cWindfalls, for example, are easily blown on frivolous purchases when you are in your 20s.<\/p>\n \u201cLater in life, however, you may realise it would have been wiser to put the money into an emergency fund or investment account,\u201d he said.<\/p>\n Thompson added the bottom line is that financial crises are larger and more expensive when you are older, and it is important to plan for these.<\/p>\n \u201cWe don\u2019t like to think about things like the cost of education, ageing parents who need support, debt and retrenchment but these are all things which could impact your life and have long-term repercussions \u2013 if you are unprepared financially.<\/p>\n \u201cYou are in charge of your money when you are older.<\/p>\n \u201cNobody is managing your allowance any longer, nagging you to save money or refusing you large loans \u2026 it is all up to you to make it work.<\/p>\n \u201cIt is very important, therefore, to adjust your spending to your lifestyle needs as you age and adopt good savings habits from an early age,\u201d he said.<\/p>\n <\/p>\n Hav<\/strong>e a story?<\/strong><\/p>\n Contact the newsroom by emailing: Melissa Hart (Editor)\u00a0<\/span>germistoncitynews@caxton.co.za,<\/a>\u00a0<\/strong>Leigh Hodgson (News Editor)\u00a0<\/span>leighh@caxton.co.za\u00a0<\/a><\/strong>or Busi Vilakazi (Journalist)\u00a0busiv@caxton.co.za.<\/strong><\/a><\/p>\n Also follow us on:<\/p>\n
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